Adoption of the proposed amendments required the consent of holders of at
least a majority of the aggregate principal amount of the outstanding 2008
notes under the indenture. As of 5:00 p.m. on October 2, 2006, $187,299,000
aggregate principal amount of 2008 notes had been tendered. The proposed
amendments will amend two of the restrictive covenants in the indenture
governing the 2008 notes. iStar Financial and the trustee under the indenture
executed the supplemental indenture adopting the proposed amendments on
October 2, 2006. Holders who tendered their 2008 notes are no longer able to
withdraw them.

The amendments will not become operative until iStar Financial accepts and
consummates the exchange of all notes validly tendered. The exchange offer and
consent solicitation are scheduled to expire on October 17, 2006. Once the
amendments with regard to the 2008 notes become operative, they will be
effective as of October 2, 2006.

iStar Financial's obligation to exchange notes that are tendered is
subject to customary conditions. iStar Financial has the right to waive these
conditions.

The exchange offer and consent solicitation is only made, and copies of
the offering documents will only be made available to, holders of 2008 notes
that have certified certain matters to iStar, including their status as
"qualified institutional buyers" within the meaning of Rule 144A, or non-U.S.
persons as defined under Regulation S, under the Securities Act of 1933
("Eligible Holders"). An offering memorandum will be distributed to Eligible
Holders and is available only to Eligible Holders through the information
agent, Global Bondholder Services Corporation, at 866-387-1500 or
212-430-3774.

The 2013 notes have not been registered under the Securities Act or any
state securities laws. Therefore, the 2013 notes may not be offered or sold in
the United States absent registration or an applicable exemption from the
registration requirements of the Securities Act and any applicable state
securities laws.

This press release does not constitute an offer to purchase any securities
or a solicitation of an offer to sell any securities. The exchange offers are
being made only pursuant to an offering memorandum and related consent and
letter of transmittal and only to such persons and in such jurisdictions as is
permitted under applicable law.